Wells Fargo Downgrades Netflix to Underweight Amid Concerns Over Declining Engagement
On September 18, Wells Fargo downgraded Netflix (NASDAQ:NFLX) from Equal Weight to Underweight and cut its price target to $57 from $80. Analyst Steven Cahall cited declining viewer engagement as a key concern, noting that average daily viewing time has dropped by about 8% compared to the same period in 2023. Despite Netflix's continued growth in household penetration and new revenue streams like ad-supported tiers and live events, Wells Fargo argues these strategies may not be enough if viewership continues to decline. Cahall expects a further drop of up to 21% in viewing time for major original titles in the second half of 2026 due to weaker content offerings. The stock has already fallen more than 20% this year, and Wells Fargo's downgrade highlights growing concerns about Netflix’s ability to sustain growth. However, other analysts remain optimistic, with Evercore ISI maintaining an Outperform rating based on strong household penetration in key markets.
Topics: ad-supported tier engagement trends Netflix stock downgrade Wells Fargo